Setting Up a Trust in Your Estate Plan

Trusts can be a great help in your estate planning — they can protect your property, save on estate taxes, and help you avoid probate. Sounds great, right? Well, before seriously considering a trust, you need to understand the basics of trusts and make a well-informed decision about setting up trusts right for you.



  • Some trusts are general-purpose; others focus on specific objectives, such as supporting your favorite charity or helping to pay for your children's or grandchildren's education.



  • A revocable living trust may be an ideal tool to protect your estate. But beware — everyone, it seems, is trying to sell you a revocable living trust. Watch out for the hype!



  • A bypass trust or a QTIP trust can help you and your spouse avoid unnecessary federal estate taxes. But you need to decide which type of trust works best in your situation.



  • Some trusts are revocable, meaning that you can change your mind. Other trusts are irrevocable — they can't be changed once you set them up. Make sure you understand the tradeoffs for your estate planning.











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Source:http://www.dummies.com/how-to/content/setting-up-a-trust-in-your-estate-plan.html

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